Dividends Galore! Most S&P 500 Companies Dishing Cash Since 1999

There are more S&P 500 companies paying dividends now than at any other point since December 1999.

That’s according to some number crunching by data guru Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. Thirteen companies have started making regular cash payouts to shareholders this year, including GameStop, Dell and even Apple. That brings the total to 402 companies within the S&P 500 that are paying dividends, which is the most in the 21st century.

Exxon Mobil recently increased its payout and is now the largest dividend payer in the world, followed by AT&T and Apple.Silverblatt notes Apple’s big sway on tech has made it the second largest dividend-paying sector, behind only consumer discretionary stocks. If Google orAmazon paid a dividend of at least 1.5%, tech would be the largest payer, he says.

“Lots of things have changed over my 35 years, but the statement that technology could be the biggest payer definitely needs to be added to my ‘who woulda thunk it’ list,” Silverblatt says in an email. “As for investors, they need to look at technology as a dividend payer. It may still have a higher beta (volatility) than other dividend issues, but it is a player, and the dividends need to be incorporated into the total return risk-reward formula.”

Dividend-paying stocks typically benefit in a slow-growth economic environment, providing cushion for investors during times of turmoil. The dividend trade has boomed in recent years amid continued concerns about the U.S. economy, Europe’s debt woes and China’s slowing economy.

“At this point, taxes are my main concern for dividends,” Silverblatt says, noting dividend taxes, under current legislation, are poised to nearly triple next year, rising to 43.4% from 15%.

“From a planning perspective, this will force corporations to reexamine their return to shareholders policy, potentially pulling back on dividend increases and increasing share buybacks,” Silverblatt says. “From an individual investor’s prospective, the risk-return ratio shifts significantly since you would now be keeping less than 57 cents on the dollar compared to the current 85 cents.”

For what it’s worth, buyback authorizations in July came in at $33 billion, representing an 11% decline from a year ago, according to data trackers at Birinyi Associates.

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